DIAMYD ON TARGET FOR PHASE III STUDIES

Press Release, Stockholm, Sweden – January 31, 2007 – Diamyd Medical AB
(SWEDEN OMX: DIAM B; USA ADR: DMYDY)

Diamyd Medical announces today that the Company has had a Type B, End of Phase II meeting, with the United States Food and Drug Administration, FDA, on the 29th of January, 2007 in Washington DC. The meeting related to the Phase III clinical program with Diamyd® in type 1 diabetes and was held with a Diamyd team of about 15 people and about an equal number of people from the FDA.

“It may take several weeks before we see the minutes from the meeting and we can therefore, at this time, say no more than that we believe that the meeting was constructive and that it may lead to approval to start Phase III clinical trials in the US within 2007”, states Anders Essen-Möller, CEO of Diamyd Medical AB.